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24.07.2020

UK Consumer Confidence holds steady for July

Improvement in ‘future personal finances’ measure is encouraging

London, July 24th, 2020 – GfK’s long-running Consumer Confidence Index has remained at -27 for July. Three measures were up and two were down in comparison to the 4th COVID-19 flash of July 3rd.  

Joe Staton, GfK’s Client Strategy Director, says: “There’s been little to boost the public’s mood as the cost of the pandemic to the UK’s economy is becoming apparent. Amidst significant job losses and the end of the furlough scheme, it is perhaps surprising Consumer Confidence has held steady at -27 this month.

"Many people have been savvy and saved money during lockdown, as the most recent GDP figures show. That could explain the one bright spark on the horizon -- the three-point uptick in consumer expectations for the financial position of their households in the next 12 months. The way we perceive our ’future wallets’ is key as it’s the one area over which we have day-to-day control and is a good indicator of our personal financial outlook for the year to come.”

UK Consumer Confidence Measures – July 2020

The Overall Index Score has remained at -27 for July. Three measures were up and two were down in comparison to the 4th COVID-19 flash of July 3rd.

Personal Financial Situation

The index measuring changes in personal finances during the last 12 months is up one point to -4; this is five points lower than July 2019. 

The forecast for personal finances over the next 12 months is up three points to zero this month; this is seven points lower than July 2019.

General Economic Situation

The measure for the general economic situation of the country during the last 12 months has decreased by one point to -61; this is 29 points lower than in July 2019.  

Expectations for the general economic situation over the next 12 months are up by one point at -41 points; this is nine points lower than July 2019.

Major Purchase Index

The Major Purchase Index has decreased one point to -26 in July; this is 30 points lower than it was in July 2019.

Savings Index

The Savings Index has improved by eight points in July to +21; this is four points lower than at this time last year.

-Ends-

About the survey

  • The UK Consumer Confidence Barometer is conducted by GfK on behalf of the EU, with similar surveys being conducted in each European country. In producing its own reports on the whole of Europe, the EU applies a seasonal adjustment to the data, to smooth out any changes that are functions, at least in part, of the time of year.
  • Historically, the UK data have not been seasonally adjusted in this way, and to maintain comparability, GfK continues not to apply this adjustment. This can lead to situations where the EU figures show different movements in a particular month from those produced by GfK. Individual months may be affected, but the long-term trend is not.
  • This month’s survey was conducted among a sample of 2,000 individuals aged 16+ on behalf of the European Commission.
  • Quotas are imposed on age, sex, region and social class to ensure the final sample is representative of the UK population.
  • Interviewing was carried between 1st July and 13th July 2020.
  • The figures contained within the Consumer Confidence Barometer have an estimated margin of error of +/-2%.
  • The Overall Index Score is calculated using underlying data that runs to two decimal points.
  • Results for the Consumer Confidence Barometer have now reverted to a monthly frequency. Forthcoming confirmed dates are as follows: August 21st, September 25th, October 23rd, November 20th and December 18th.
  • Any published material requires a reference to both GfK and the European Commission e.g. ‘Research carried out by GfK on behalf of the European Commission’.
  • This study has been running since 1974. Back data is available from 2006.
  • The table below provides an overview of the questions asked to obtain the individual index measures:

Personal Financial Situation

(Q1/Q2)

This index is based on the following questions to consumers: ‘How has the financial situation of your household changed over the last 12 months?’

‘How do you expect the financial position of your household to change over the next 12 months?’ (a lot better – a little better – stay(ed) the same – a little worse – a lot worse)

General Economic Situation

(Q3/Q4)

This index is based on the following questions to consumers: ‘How do you think the general economic situation in this country has changed over the last 12 months?’

‘How do you expect the general economic situation in this country to develop over the next 12 months?’

(a lot better – a little better – stay(ed) the same – a little worse - a lot worse)

Major Purchase Index

(Q8)

This index is based on the following question to consumers: ‘In view of the general economic situation, do you think now is the right time for people to make major purchases such as furniture or electrical goods?’

(right time – neither right nor wrong time – wrong time)

Savings

Index

(Q10)

 

This index is based on the following question to consumers: ‘In view of the general economic situation do you think now is?’ (a very good time to save – a fairly good time to save – not a good time to save – a very bad time to save)

(Commented on but not included in the Index Score)



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